All These Mergers... Consumers Are Asking: Will Their Brand Connection Still Be There?

Article by Ernan Roman Featured on CustomerThink.com

“By combining companies, we believe will be able to…enhance the customer experience, increase customer value and put ourselves in an even stronger position to help shape and lead the next generation of shopping,” So said Mike George, QVC’s president and CEO.

But will they?

When brands merge are they diluting the brand message and connection with consumers? With so many mergers and acquisitions recently, you have to wonder what it means for brands and their connection with consumers.

L’Oréal which owns 34 brands has a unique perspective—let the brand be itself and be what consumers want. Jean-Paul Agon, L'Oréal CEO, noted, “Brands have to be authentic, but for [consumers], it means the brand is transparent and there is sincerity in what they express… We have to adapt permanently, or even anticipate permanently, the consumer’s demands…”

The lesson for brand managers going though mergers it that it’s essential to both respect and reassure consumers who have made a financial and time investment in selecting and patronizing “their brand.” When things “change” due to merger, an emotional connection could be at jeopardy if doubt sets in that that their original decision to become a customer is no longer valid.

The Harvard Business Review noted that an emotional connection between a brand and its consumers is a significant differentiator. “On a lifetime value basis, emotionally connected customers are more than twice as valuable as highly satisfied customers.”

Here’s a bit of insight they share that brand managers should take note of:

• “Most companies lack a strategic objective that spans the customer journey.”
• “Our research across hundreds of brands in dozens of categories shows that the most effective way to maximize customer value is to move beyond mere customer satisfaction and connect with customers at an emotional level – tapping into their fundamental motivations.”

The advice In our ERDM learnings from 15,000+ hours of VoC research interviews, consumers told us that understanding them and developing relationships is a competitive differentiator for maintaining a strong brand connection:

• “Your generic communication make it obvious that you don’t understand me. You are trying distill my complex needs into simple generalities to make it easier for you … and useless to me!”
• “You marketers don’t understand that personalization is valuable … it forges strong ties when there is the almost-certain outreach from competition.”

One of the issues in meeting consumer connection needs according to Adobe Digital Insights (ADI), is that brands think that they are delivering this experience but according to consumers—they are not.

Tamara Gaffney, principal analyst at ADI, explains why value is always the key to connections.

“[Brands] have to demonstrate value to the consumer. Companies are still not built to be able to do that…. At a time when marketers are competing for time and attention…Organizations, themselves, are fragmented, and, on top of that, their technology is fragmented, making it difficult to make progress…We’re in a really high-pressure environment where marketers need to not only protect their loyal base, but also efficiently steal from the competition… The winners are going to be the companies that have the technology and chops to serve relevant, personalized communications to consumers, consistently…”

TakeAways:

1. Consumers want meaningful relationships with brands. When doubt creeps into a consumer’s mind they lose the original motivation that sparked their connection in the first place. Brands need to be sincere and clear in all touch points so that the value “reason” is continually reinforced and present.

2. An emotional consumer connection with your company is a primary driver of engagement. Actively involved consumers are far more likely to be not only be top purchasers but also vocal and authentic brand ambassadors. But this takes a continual commitment to demonstrate understanding and develop highly personalized experiences.

3. To grow, companies need to protect the investment they have in their already loyal consumers while simultaneously reaching out to new prospects. And, finding ways to be relevant to both.

With so much merging and blending, the question is; will these combined companies thrive or not? However, one thing is for sure; consumers will want proof that any new union deserves their patronage. In an interview, Doug Rose, SVP of programming and marketing for QVC, said, “Amid the rapid transformation of our business, our recipe for cultivating loyalty has not changed: To deliver a shopping experience that fosters enduring relationships, rooted in trust.”

4 Requirements for Linking CX to ROI

Article by Ernan Roman Featured on crmirewards.com

Eighty-one percent of consumers are willing to pay for a better experience, according to the Capgemini’s study “The Disconnected Customer.” Yet, customers don’t feel that companies are delivering high quality customer experience (CX), and one in five consumers stopped purchasing from a company after a poor experience, Capgemini’s research found.

In our own ERDM learnings from more than 16,000 hours of VoC research interviews, consumers were emphatic that short-term sales-focused tactics were irritating, brand damaging, and undermined loyalty. As empowered consumers, they expected engagement oriented communications and experiences.

Here is a representative quote from the research: “You marketers don’t understand that personalized engagement post-sale is valuable for the customer and... forges strong ties with your company that serve as a ‘grace account’ upon which to draw when there is the almost-certain problem or outreach from competition.”

Chris Hull, Chief Merchandising Officer at the iconic American luxury lifestyle brand Shinola, puts it this way, “Consumers are looking for meaningful experiences that differentiate one brand from another. One way we do this is by designing our stores to engage the five senses:

• Sight – see team members build bicycles or do personalized embossing;
• Sound – a warm welcome and vinyl playing on our Runwell Turntable;
• Touch – well-crafted products, such as watches and leather bags;
• Taste – a complimentary bottle of Shinola Cola;
• Smell – the smell from our Shinola candles lit throughout the store.

This is all part of conveying our distinctive handcrafted products and has resulted in higher engagement, satisfaction, and conversion rates.”

With this in mind, here are four factors that will help you link CX to improved ROI:

1. CX strategies must align with consumer demands

Too often sales strategies are spray painted to look like CX strategies. However, customers are smart and know the difference between sales pitches posing as engagement and true CX. They resent when marketers think that customers are too naïve to know the difference.

According to Nike Chief Executive Mark Parke in comments about CX strategy development, “The important thing to point out is that changes are being driven by the consumer…. They want it fast, easy, and [they want] personal service.” Nike has implemented measures to drive personalization and has seen sales improvements in a landscape where so many other retailers and brands are failing.

2. Accurate data is essential for driving CX initiatives

As Jim Conning, managing director at Royal Mail Data Services so aptly puts it, data accuracy is non-negotiable for ROI: “CMOs and marketing directors all understand the importance of accurate customer data, but I’m not sure that more inexperienced members of the team understand the increased ROI of more accurate data.” The company’s research indicated that 34% of marketers fail to fully understand the financial impact of poor quality data; 70% of the 300 companies surveyed admit to having incomplete or out-of-date customer data; and 6% of annual revenue is being lost through poor quality data.

3. ROI also requires CX-focused content

Irrelevant content hurts your brand, so stop sending spray-and-pray blasts!

This quote from our VoC research is a blunt reminder. “When I receive generic emails, it’s obvious that you do not care enough to understand my individual needs. Instead, you are trying distill my complex needs into simple generalities to make your email blast easier for you...and useless to me!”

Consider this from a Salsify Study: “If you provide superior content, and a competitive price, you have the opportunity to both close the sale and build long-term consumer loyalty.” The study found that…

• 88% of consumers say that product content is extremely or very important to their purchase decision
• Price matters, but it’s product content that gets consumers to buy

4. Establish CX-oriented metrics and compensate accordingly

New and additional metrics are required to track and compensate for CX-oriented behaviors. Too many companies fail to change metrics to reflect their CX strategies and still compensate based on legacy “sell ‘em and forget ‘em” models.

In this blog post, Michael Klein, director of industry strategy for the Adobe Marketing Cloud, presents some effective soltuions that brands can implement to select the optimal CX metrics. One, from Epsilon’s Rob Cantave, especially stood out: “CRM data helps us understand what current customers are interested in seeing. Combining that with our third-party data lets us better understand what clusters of customers have in common. We present that information to the automated models and have them test and ultimately identify the product, categories, or content most likely to be of interest to returning customers and brand new unknown users who’ve been seen elsewhere in our network.”

Linking CX to ROI is a complex, multiphased, and corporate-wide pursuit. Remember:

• CX requires company-wide consistency and communication so employees understand and are trained on the goals and behaviors they need to demonstrate every single day.
• It also requires an omnichannel, data-driven strategy that’s based on meeting the requirements consumers indicate are important—to them. CX is useless without a consumer-focused approach because it will be observed as sales-y and meaningless.
• Similarly, irrelevant content is perceived as demonstrating that a brand does not care about developing long-term customer relationships.

To achieve maximum ROI, companies need to rethink how they view CX and build impactful and sustainable strategies to satisfy customer needs over the customer lifecycle.